Telenor Group has entered into agreements to buy 54% of the Finnish telco DNA for €1.5 billion in cash.
The transaction, with DNA’s largest shareholders Finda Telecom Oy and PHP Holding Oy, which currently hold 28.3% and 25.8% of shares in the company respectively, places a value of €20.90 per share and is subject to certain conditions. These include the approval by the general meetings of the seller entities and required regulatory approvals, and the former’s boards of directors will recommend the agreements to shareholders and convene general meetings on May 6.
Telenor notes that certain shareholders in Finda and PHP have through irrevocable undertakings agreed to vote in favour of the transactions in the Finda and PHP general meetings. Telenor expects the transaction to be completed during the third quarter of 2019.
It also says that once completed, the transaction will trigger a mandatory public tender offer for the remaining outstanding shares in DNA by Telenor. The cash consideration per share to be offered in the mandatory tender offer will be €20.90. Subject to the outcome, Telenor’s intention is to keep DNA’s listing on the Nasdaq Helsinki stock exchange.
Telenor also says that DNA, based in Helsinki, is an integrated fixed and mobile telecom operator with a solid market position in the fastest growing mobile market in Europe. The company is the third largest mobile operator in Finland, with 2.9 million subscribers and 28% market share. DNA’s customers are enjoying the fastest mobile network in Finland, and the company has over the past three years increased its mobile service revenues by 9.3% per year. In addition, DNA is the second largest fixed broadband provider and the largest cable TV provider in Finland. In 2018, it reported revenues of €912 million, EBITDA of €285 million, and operating cash flow of €147 million. DNA has been ranked as the most attractive employer in Finland, and the DNA brand is among the top ranked brands in Finland.
Commenting on the deal, Telenor Group chief executive Sigve Brekke, said: “I am very pleased to announce today’s transaction and our entry into Finland, the fastest growing mobile market in Europe. DNA is an exciting addition to Telenor Group, and a natural complement to our existing operations in the Nordic region. Not only are we strengthening our footprint in the Nordic region, we are also gaining a solid position across fixed and mobile in the Finnish market and making room for further value creation. I would like to congratulate DNA’s management and all employees for the impressive journey taking the business to what it is today. We will continue to invest in DNA and will support the team in their focus on delivering high-quality services to the customers in Finland. I am looking forward to welcoming all DNA employees to the Telenor family and to an exciting future ahead of us”.
